SCHEDULE: Kingsway Financial Major Shareholder Sells 500,000 Shares

A group of major shareholders in Kingsway Financial Services Inc. reduced their stake by selling 500,000 common shares to David Capital Partners Special Situation Fund, LP at $8.25 per share.

Summary

• Oakmont Capital Inc., part of a reporting group including E.J.K. Holdings Inc., 1272562 Ontario Inc., Terence M. Kavanagh, and Gregory P. Hannon, sold 500,000 common shares of Kingsway Financial Services Inc.
• The sale was made to David Capital Partners Special Situation Fund, LP ("DCP Special") at a price of US$8.25 per share.
• This transaction occurred on December 17, 2025, following the exercise of a previously disclosed option agreement.
• Following the sale, the reporting group beneficially owns an aggregate of 2,386,119 shares, representing approximately 8.24% of Kingsway Financial Services Inc.'s outstanding common stock.
• The percentage is calculated based on 28,956,152 shares outstanding as of November 6, 2025, plus 315,789 shares issuable upon exercise of Series B Warrants and conversion of Class C Preferred Shares held by the reporting persons.

Sentiment

Score: 6

Explanation: The transaction is a planned exercise of an option, indicating an orderly change in ownership rather than a distressed sale. While it reduces the stake of a long-term group, it introduces a new institutional holder (DCP Special), which could be viewed neutrally to slightly positive depending on DCP Special's reputation and intentions.

Positives

• The sale of shares at US$8.25 per share provides liquidity to the selling entity, Oakmont Capital Inc.
• The transaction was the exercise of a pre-existing option, indicating a planned and orderly change in ownership.

Negatives

• The reporting group's aggregate beneficial ownership in Kingsway Financial Services Inc. has decreased by 500,000 shares, reducing their overall stake from a prior, unspecified level.

Future Outlook

The reporting persons have no current plans or proposals which relate to or would result in any of the events described in Items (a) through (j) of the instructions to Item 4 of Schedule 13D, other than the disclosed option exercise.

Industry Context

This filing indicates a shift in the ownership structure of Kingsway Financial Services Inc., with a significant block of shares changing hands from a long-standing reporting group to David Capital Partners Special Situation Fund, LP. Such transactions can reflect strategic portfolio adjustments by institutional investors or a re-evaluation of the issuer's prospects, potentially signaling new institutional interest in the company.

Comparison to Industry Standards

• This filing primarily details an ownership change and does not contain operational or financial performance metrics that would allow for a direct comparison to industry standards or specific comparable companies/projects. The share price of US$8.25 for the transaction would need to be assessed against the prevailing market price and historical trading patterns of Kingsway Financial Services Inc. and its peers to determine its relative value.

Related Party Transactions

• The transaction involves Oakmont Capital Inc. (part of the reporting group) selling shares to DCP Special, which is a transaction between parties with existing arrangements (the option agreement). The reporting group itself consists of related entities and individuals (Oakmont, EJK, 1272562, Mr. Kavanagh, Mr. Hannon) who collectively hold a significant stake in Kingsway Financial Services Inc.

Stakeholder Impact

• Shareholders: The transaction results in a reduction of the aggregate beneficial ownership of a long-standing group of shareholders, potentially altering the shareholder base and influence dynamics. The introduction of DCP Special as a new significant holder could bring new perspectives or strategic interests.

Key Dates

Recommendation

The filing details a pre-arranged sale of shares by a significant shareholder group, which is an expected event. While it reduces the stake of a long-term holder, it also introduces a new institutional investor. Without further information on the motivations behind the sale, the buyer's intentions, or the company's current operational performance, a 'hold' recommendation is appropriate as this transaction alone does not provide a strong catalyst for a 'buy' or 'sell' decision. Investors should monitor future filings and company performance for more comprehensive insights.

Keywords

Kingsway Financial Services, Schedule 13D/A, Share Sale, Beneficial Ownership, Oakmont Capital, DCP Special, Common Stock, Institutional Investor, Equity Stake